Driving growth through system consolidation

Read the interview and learn about:

• Why consolidating systems enables you to tackle complexity and achieve efficiencies
• How operating fewer systems supports automation
• Why automation enables regulatory compliance and reduces risk
• The impact of simplification on business performance

 

Mette Trier, Editor-in-Chief, Journal of Applied IT in Investment Management

Like its industry peers, CNP Assurances, the leading personal insurer in France and the fourth largest life insurer in Europe with EUR 335bn (excluding unit-linked) under management, is facing a changing regulatory environment, rising tech-complexities, increasing data amounts, as well as demands for more reporting and transparency. To tackle these challenges of a complex world, CNP Assurances decided to optimize its system architecture through simplification and consolidation in the pursuit of a single fully integrated solution. Winning the SimCorp Award 2017 for its achievements based on this strategy has proven that this was the right approach for CNP Assurances.

We met with Rémi Desmichels, Head of Asset Management Projects at CNP Assurances, right after he received the SimCorp Award 2017 on behalf of CNP Assurances in Barcelona in September to learn more about the insurance firm’s success story.

CNP Assurances is using one system, SimCorp Dimension, as the backbone of its operations to manage its entire range of assets – including equity, fixed income, derivatives, and private debt (the last two are ongoing projects) – across front, middle, and back office. “Bringing all assets onto the same platform has been the strategy at CNP Assurances to tackle the increasing challenges of complexity in the investment management industry,” Rémi Desmichels explains.

Managing an increased amount of data

In the past year, CNP Assurances has been faced with an increasing amount of data due in particular to its growing activities in both Europe and Brazil. “To tackle the data challenge,” Rémi Desmichels clarifies, “we decided to extend the use of our core investment management system in a range of ways in terms of handling our expanding assets portfolio.” Within alternative investments, CNP Assurances wants to decommission as soon as possible the solution formerly in place for managing the insurer’s real estate, infra-structure, and private equity assets, bringing these assets onto its core platform. “Furthermore,” Rémi Desmichels explains, “we have onboarded new financial instruments to the core platform by help of the innovative XpressInstruments/Trade Manager solution.” Finally, CNP Assurances has decided to also manage its private debt securitization funds within the core investment management system.

Within alternative investments, we want to decommission as soon as possible the solution formerly in place for managing our real estate, infra-structure, and private equity assets, bringing these assets onto our core platform.Rémi Desmichels, Head of Asset Management Projects at CNP Assurances

Taking the above initiatives, along with centralizing static data management on its core platform, has enabled CNP Assurances to achieve significant efficiency gains. Rémi Desmichels gives as an example that: “CNP Assurances has managed to reduce its accounting closing time by 50% and to move from a monthly to an intraday valuation of all our assets.” “These achievements clearly illustrate the benefits of automating the front-to-back accounting process, enabling operational teams to focus more on their core business, i.e. managing exceptions rather than working on manual processes,” Rémi Desmichels continues.

CNP Assurances has managed to reduce its accounting closing time by 50% and to move from a monthly to an intraday valuation of all our assets.Rémi Desmichels, Head of Asset Management Projects at CNP Assurances 

Tackling regulatory challenges with automation

CNP Assurances also relies on its core SimCorp Dimension platform to comply with regulations like EMIR and Solvency II. “The system has helped to standardize all our major EMIR related processes, e.g. the trade repository declarations. Similar levels of automation have been achieved for Solvency II, where the data from SimCorp Dimension feeds directly into the production of quarterly reporting templates. A project has recently been launched to achieve a similar process for IFRS9 on our core platform,” Rémi Desmichels explains.

Meeting increased reporting demands

In late 2016, CNP Assurances launched a project to deploy SimCorp’s Data Warehouse solution to enhance reporting capabilities and to provide greater transparency to both its clients and its investors. The leading French insurer expect this solution to enable the firm to provide real-time reporting and give access to a number of user-friendly dashboards. “In the coming years, this solution should be the cockpit for the data used for the digitization of all these activities,” Rémi Desmichels elaborates.

Achieving one source of truth fulfills higher transparency demands

At a general level, using one single platform front-to-back has enabled CNP Assurances to enhance its reporting capabilities with a higher level of transparency for its investors and for regulators. Rémi Desmichels underlines the value of the fact that “It has also enabled us to provide our users with a consolidated view of all our assets, including static and market data. Furthermore, this overview is provided in a user-friendly environment that displays all data in an intuitive manner.”

Managing increasing tech-complexity

“The demand for handling a rising level of tech-complexity has also been tackled by CNP Assurances’ previously mentioned decision to streamline its IT architecture and reduce operational complexity,” Rémi Desmichels stresses. “The efforts to reduce complexity by centralizing the management of all assets classes – traditional and alternative – in one system are being made in close collaboration with our vendor,” he explains and describes that: “the teams are working in an agile framework which has allows discussions on priorities, testing of new functionalities, and full transparency on the development all along.” To further support the efforts of reducing tech-complexity, CNP Assurances has streamlined its database structure.

Confidently moving step-by-step towards a consolidated systems landscape

By deploying an integrated solution, CNP Assurances has gradually consolidated its system landscape, decommissioning more than 25 legacy systems over the course of the project. Rémi Desmichels says that: “The results include increased automation and higher levels of organizational efficiency. An already mentioned tangible outcome of our efficiency gains is that we have managed to cut our accounting closing time by 50%.” Furthermore, by introducing new automated workflows, for instance full automation of our balance sheet and P&L accounts’ reconciliation, CNP Assurances’ operational teams are now able to focus more of their valuable time on core business tasks, such as exception handling, rather than on manual processes.

Consolidation has proven its case

“As I trust our peers will agree, the journey towards systems consolidation can seem overwhelming at first,” Rémi Desmichels admits. “However, the step-by-step implementation of SimCorp Dimension front-to-back has given rise to an abundance of positive changes across the CNP Assurances business. The benefits we have achieved in terms of higher levels of automation and optimized processes, let alone much improved employee satisfaction caused by more value-added tasks, far outweigh the necessary investment,” Rémi Desmichels concludes. For the future, CNP Assurances is among more planning to support its continued growth by help of SimCorp’s solutions and by onboarding subsidiaries to its core investment management platform – all in line with the vision of operating a single fully integrated platform.

About Rémi Desmichels

Rémi Desmichels is Head of Asset Management Projects at CNP Assurances.

Graduated from ESLSCA Business School in 1997, to become a Treasury Manager, Rémi DESMICHELS has quickly integrated the consulting world to mainly lead asset portfolio management projects for insurance companies, and from 2005 onwards, to develop skills on investors servicing programs as Senior Manager in CSC. In 2010, he was hired by CNP Assurances, as Head of Business Analysts, in order to start the PALLADIO Project aiming to transform the investment management value chain based on a SimCorp Dimension backbone. In 2015, he became Head of Assets Management Projects to be in charge of the PALLADIO platform strategy.